Shelley hails another 'extremely strong' year for Hachette UK despite 'slightly declining market’

Overall revenue for Hachette UK parent company Lagardère rose sharply in 2022, according to its full-year financial results, with its UK publishing arm growing 3.4% in a “slightly declining market".

Group revenue for the year totalled €6.9bn (£6.2bn), up 28.3% on a like-for-like basis on 2021. However, Lagardère’s overall publishing division, which encompasses Hachette and Partworks, saw revenue down 1.9% on a like-for-like basis due to currency fluctuations, with its revenue standing at €2.7bn (£2.4bn) for the full year.

The report states: "Amid a market downturn and high inflation, Lagardère Publishing maintained a very high level of like-for-like revenue."

Group recurring EBIT (earnings before interest and taxes) hit €438m (£389m), up from €249m (£221m) on the year before. The publishing division reported EBIT of €302m (£268m), down from €351m (£312m). The report said this fell after the "exceptional 2021 performance" and is attributable in particular "to lower like-for-like revenue levels in an unfavourable market context, as well as to the impact of acute inflationary pressure on production (paper, printing, etc.), freight and personnel costs". It stressed it was largely offset by gains from operational initiatives (including selling price increases) and an efficient cost control management

As predicted, the publishing division has an operating margin of 11%. Arnaud Lagardère, chairman and c.e.o of Lagardère SA, said the group had delivered a “historic performance” in 2022. “After an exceptional performance in 2021, Lagardère Publishing managed to maintain a very high level of revenue, driven by the success of bestsellers in its various publishing houses,” he said.

In 2022, digital audiobooks accounted for 4.3% of Lagardère Publishing’s total revenue (compared to 3.8% in 2021), and e-books accounted for 7.8% of the division’s total revenue, versus 7.7% one year earlier.

The UK publishing arm recorded an increase in revenue of 3.4% in “a slightly declining market” thanks, according to the report, to the success of the Adult Trade segment, which mainly reflected the year-round sales of bestsellers such as Colleen Hoover’s Verity (Sphere) and Ali Hazelwood’s The Love Hypothesis (Sphere).

Business was also supported by a good backlist performance, with the Heartstopper series by Alice Oseman, published by Hachette Children’s Group and adapted on Netflix, and Delia Owens’ Where the Crawdads Sing (Little, Brown), the movie adaptation of which is set to be released in July, doing particularly well. 

David Shelley, c.e.o of Hachette UK, said it had been another extremely strong year for Hachette UK, despite a more challenging supply chain than was experienced in 2020 and 2021.

Alongside Oseman and Owens, key titles of the year included Fairy Tale by Stephen King (Hodder and Stoughton), The Ink Black Heart by Robert Galbraith (Little,Brown), The Locked Room by Elly Griffiths (Quercus), Murder Before Evensong by Richard Coles (Orion), Friends, Lovers and the Big Terrible Thing by Matthew Perry (Headline), and Undoctored by Adam Kay (Orion).

Shelley said Hachette UK’s TCM volume grew by 7.5% compared to 2021. He cited “good performances from across the group” and said standout divisions included Little, Brown, Hachette Children’s Group, Bookouture, Hachette Australia and Hachette India. The report notes under Lagardère’s UK publishing that “international activity advanced, fuelled by the success of high-profile titles on social networks in Australia and New Zealand and by a strong recovery in India".

Education also had an excellent year, Shelley continued, with Hodder Education now the second largest publisher overall in UK schools and colleges, and the largest in the secondary market. He added that for HUK Distribution it was also “a really positive year", both operationally and in terms of new client publishers signed up.

He said: “We continue to benefit from the depth and diversity of our publishing. Alongside book bestsellers we saw exceptional sales for the Laurence King gift and games list, as well as a record year for our recent acquisition Paperblanks, the second largest premium stationery publisher in the world after Moleskine.

“Along with commercial growth, we also saw our staff population spread across the UK with the development of our national offices. These cultural hubs are vital in our drive to represent the breadth of audiences we aim to serve and we have ambitious growth plans for 2023.”